Jane Van Ryan
Posted October 6, 2010
For months, numerous studies--such as this one from LSU professor Dr. Joseph Mason and another by Moody's Analytics--have demonstrated the significant economic impact the deepwater drilling moratorium could have on the Gulf and U.S. economies.
A Southern Methodist University (SMU) study released this week is no different, and it presents some alarming figures on the impact the de facto moratorium is having on shallow-water drilling.
According to Dr. Bernard L. Weinstein, associate director of SMU's Maguire Energy Institute, the Interior Department's slowdown in issuing new permits for shallow-water drilling operations could mean:
- 50,000 lost jobs;
- Economic losses of $4.3 billion that would occur if 75 percent of the rigs become idle as a result of fewer issued permits; and
- $12.5 billion in lost income nationwide.
As Dr. Weinstein points out, shallow-water drilling is extremely safe. In the last 15 years, the federal government reports that more than 11,000 wells have been drilled and just 15 barrels of oil have spilled as a result of a loss of well control:
"Shallow-water drillers work in less than 500 feet of water, mainly extracting natural gas. Projects center on well-charted fields of known pressure and geography, using simple and straightforward technology."
Prior to the moratorium, 10 to 15 permits for new shallow-water wells were approved each month. But since April, only seven permits for new shallow-water wells have been issued, and 15 of 46 shallow-water rigs in the Gulf are idle.
As Jack Gerard mentioned in a blog post last week, a drilling slowdown hurts more than just oil companies. It's time to put the oil and natural gas industry back to work and produce reliable American energy for Americans.
ABOUT THE AUTHOR
Jane Van Ryan was formerly senior communications manager and new media advisor at the American Petroleum Institute (API), where she wrote blog posts and produced podcasts and videos. Before coming to API, Jane managed communications for a large science and engineering corporation, and for a top-tier research and engineering university. A few years ago, you might have seen her in your living room when she delivered the news on television. Jane officially retired from API in 2011 and now freelances as an independent communications consultant when not gardening at her farm in Virginia.